The first part of Dave Ramsey’s Baby Step 1 (BS1) is to get on a written budget. Fortunately, we had already been working out the kinks in a budget since we moved here for some more military training. So when we started to do the TMM (Total Money Makeover), we had a step ahead. We just fine tuned a few things and started squeezing money out of every corner we could find.
We are currently living on $300 a month in groceries (for myself, my husband, and our two year old. Our 3 month old breastfeeds exclusively, so that’s one less mouth to feed for a while) and $100 a month in gas. We’re trying to sell our car and downsize to free up another $300 a month to throw at debt (so far no luck there, but we’re not aggressively perusing that). Anyway, we’re spending as little as humanly possible (we’re allowing about $30 a month for spending money divided between us). That may not seem like a lot, but we don’t have a lot of time to do anything anyway! Plus, there are a lot of really cool fun free things to do here – not to mention the gorgeous beach that is a stones throw away from us! But no matter where you live, you can always find fun free things to do. We spend about $10 a month on movies by mail so that we can save money on going out to see the latest greatest movies. We don’t spend gas getting to the theater, we don’t spend money on tickets, and we don’t spend money on a sitter, since we just watch the show after the kids are in bed.
I’m getting really adept at using Quicken to balance our checkbook. I’ve set up “line items” in our checking account so I can “save” without actually putting the money in another account. I use my Quicken balance as my actual balance, since there is a bunch of money in our checking account that is sitting around waiting for the day we pay for car insurance, registration, oil changes, dental work, etc.
We’re really learning how to live well within our means. We have definitely felt the blessings for following the counsel of our Prophet to get out of debt and save a little for a rainy day.